Question · Q4 2025
Brian Drabb inquired about the 10% utility growth assumption for 2026, asking about the proportional contribution of price versus volume. He also questioned the growth expectations for non-utility infrastructure segments (telecom, lighting & transportation, coatings) and the specific tailwinds for the coatings business from data centers and AI. Finally, he asked about the incremental operating margins on additional utility capacity.
Answer
Tom Liguori, Executive Vice President and CFO, confirmed the 10% utility growth, noting a shift from more price than volume in 2025 to more volume than price in 2026, with capacity expansions yielding mid-to-upper 20% incremental margins, approaching 30%. Avner Applbaum, President and CEO, detailed growth across non-utility infrastructure: low-to-mid single digits for telecom, growth in coatings driven by data centers/AI and internal support, and lighting & transportation benefiting from DOT spend and international stabilization. He emphasized coatings' strong third-party business aligned with growth regions. Tom Liguori reiterated the strong incremental margins on utility capacity due to increased throughput and lower unit costs.
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